Targacept Falls After Dropping Plans to Seek Drug’s Approval

March 20 (Bloomberg) -- Targacept Inc. sank the most in
three months after the antidepressant the company was testing
with AstraZeneca Plc failed in its last two late-stage studies,
ending plans to seek regulatory approval.

Targacept dropped 30 percent to $5.19 at the close of New
York trading for the biggest decline since Dec. 20. The shares
of the Winston-Salem, North Carolina-based company are down 79
percent in the last 12 months.

AstraZeneca and Targacept were testing the drug, known as
TC-5214, as an adjunct treatment for major depressive disorder.
The London-based drugmaker had licensed the treatment from
Targacept in 2009 in a deal valued at as much as $1.24 billion.
Targacept fell 36 percent on Dec. 20 after the two companies
said TC-5214 hadn’t met its target in a late-stage trial.
Today’s failures were the final of four studies on the therapy.

“This latest failure marks an end-of-road for TC-5214
program,” Robyn Karnauskas, a New York-based analyst with
Deutsche Bank, wrote in a note to clients today. “We believe
markets have already factored in TC-5214 failure and we see
limited downside from current levels.”